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To the Hon. HOWELL COBB,

Ex. Doc.
No. 55.

WASHINGTON, March 1, 1851.

I have the honor herewith to transmit to the House of Representatives manuscript No. 2 of the opinions of the Attorneys General, prepared in pursuance of its resolution of July 24, 1850.


Speaker of the House of Representatives.







Interest on certificates issued pursuant to the act of Congress passed August 4, 1790, is not allowable, and the cour's would embarrass a system of finance by a determination in favor of interest for the year 1791.

PHILADELPHIA, August 21, 1791.

SIR: In the opinion given by Mr. Bradford and Mr. Ingersoll. I find the case of Mr. Robert Buchanan to be accurately stated; but after paying a respectful attention to the sentiments of those gentlemen, I am compelled to say that I differ in the conclusion drawn from that statement, for I cannot agree that any interest is to be received upon the certificate for the year 1791.

I acknowledge that the certificate was issued in conformity with the act of Congress passed on the 4th of August, 1790, and that its silence as to interest is no objection to such a claim, if that act warrants it.

A subscription to a loan is therein proposed, payable in certificates issued for the domestic debt. Among these are some bearing an interest of six per cent., and others, called indents of interest, bearing no interest at all. Mr. Buchanan's certificate is founded upon indents of interest; and had they been subscribed, he would have been entitled to a certificate purporting that the United States owe to him, as the holder, or his assigns, the sum of $7,500, bearing an interest of three per centum per annum.

He has not, however, subscribed those indents, but obtained the certificate from the Register of the Treasury before the 1st day of June, 1791, to wit: on the 16th of February, 1791, in pursuance of the tenth section of the above mentioned act. Upon the construction of that sec tion the decision depends.

The opinion asserts the first part of that section to be a substantive clause, and yet in the next sentence it connects that clause with the following parts of the section. The truth is, that the section itself forms one integer. The term creditors comprehends all holders of the domestic debt which might be subscribed to the loan, and was not. It is immedi ately afterwards directed that such of them as possess the original certificates should exchange them for others, to be issued by the Register of the Treasury; consequently all the non-subscribing creditors are under the necessity of making this exchange, and, being so, must submit to the conditions prescribed for it.

One of these conditions is, that the new certificate shall not only specify the specie amount of those which are cancelled, but shall be otherwise of the like tenor with those heretofore issued by the Register of the Treasury for the registered debt. These import that the debt bears an interest of six per centum; and it is not denied that a new certificate given in lieu of cancelled indents, cannot carry an interest of six per centum. The question, then, is, whether a new certificate, which is not upon the most sanguine construction capable of a higher interest than three per centum, is of the same tenor with one granting an interest of six per centum?

It does not seem to be correct to resort to the popular and common acceptation of the words "like tenor," when they are known to be peculiarly technical. Nor can I admit that this acceptation would establish in this instance a likeness of tenor between two papers, so substantially different as in three per cent. per annum. The gentlemen, by confining their exposition to popular acceptation, virtually concede the interpretation of law to be against them. And without entering into prolix authorities, I take the liberty of saying that in every law proceeding which I can call to mind, it would be decided that there is a material variance between two such documents; and therefore that they could not be of the same


But let us not content ourselves with resting on the criticism of single words: let us rather examine the context.

It is not for me here to estimate the merit of any scheme of finance: my office is to ascertain the sense of Congress. It strikes me, then, immediately, that the principal was far more respected than the interest, and that the higher interest allowed to the former was intended to correspond with that stipulated by the old certificates, whereas no interest was originally stipulated on the latter. It appears probable that, being anxious that all the indents of interest should be subscribed, they might have satisfied themselves of the propriety of distinguishing between subscribed and unsubscribed indents, because interest, not being demandable on the face of them, might in some measure be considered as a gratuity, which the legislature might apportion at pleasure.

That such was the meaning of Congress, is confirmed by the first clause in the tenth section itself, which gives to non-subscribing creditors interest during the year 1791, including interest to the last day of Decem. ber, 1790; thus showing that creditors whose demands would carry interest to that time by force of the contract, were the persons contemplated: of this kind were indents for interest. And this idea receives confirmation from the care used in the third section to be explicit as to certificates carrying no interest, when they are really designed.

Upon the whole I cannot persuade myself that, with these strong fea tures, indicating the purpose of Congress, the courts of the United States would embarrass a system of finance by a determination in favor of interest to Mr. Buchanan for the year 1791.

I have the honor, sir, to be, with great esteem and respect, your most obedient servant,



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The commissioners appointed in pursuance of the act incorporating the Bank of the United States have no power, as such, to superintend the election of directors, or to interfere therein.

PHILADELPHIA, October 18, 1791.

THE Attorney General of the United States does himself the honor of replying to the questions propounded by the Secretary of the Treasury of the United States, in his letter of the 12th of October, 1791, as follows:

1st. The commissioners appointed in pursuance of the act incorpora ting the Bank of the United States have no power, as such, to superintend the election of directors, or to interfere therein.

By the first section of that act subscriptions towards constituting the stock were to be opened, under the superintendence of such persons, not less than three, as should be appointed for that purpose by the President of the United States. The President was to appoint them accordingly; and the subscriptions were to continue open until the whole of the stock should be subscribed.

The fifth section provides that as soon as the sum of 400,000 dollars, in gold and silver, shall have been actually received on account of the subscriptions to the said stock, notice thereof shall be given by the persons under whose superintendence the same shall have been made, in at least two public gazettes printed in the city of Philadelphia; that the said persons shall, at the same time, in like manner, notify a time and place within the said city, at the distance of ninety days from the time of such notification, for proceeding to the election of directors; that it shall be lawful for such election to be then and there made, and that the persons who shall then and there be chosen shall be the first directors.

These are the only clauses which relate to the commissioners.

By the former clause their authority would have been concluded as soon as the whole of the stock was subscribed.

Nor was it extended by the latter, farther than to enable them to notify the time and place for proceeding to the election of directors; that is, the time and place, when and where, the persons capacitated to elect should proceed to elect.

The commissioners will, I suppose, appear with the books, that it may be known who were the original subscribers. But this duty naturally arises from their possession of those books, which are the best evidence of the original rights. The superintendence of the election has no analogy to such a possession.

2d. But does the smallest necessity exist why the commissioners, as such, should become the judges or superintendents of the election, or in any manner intermeddle in it? Is it not familiar to the experience of every day that persons assemble, with equal privileges of suffrage, and without the pre-eminence of any one of them, in order to constitute a body for the management of business? The first step is to appoint a moderator, or chairman. In the present instance the stockholders may with ease choose one or more persons to receive and count the votes, to report the numbers, minute the proceedings, and notify to the newlyelected directors their nomination. This seems to be a completion of the work.

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